Verizon Forces Time Warner to Drop Fiber Optic Claims

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Time Warner Cable Inc. has agreed to pull ads claiming its telecommunications services are carried on a fully fiber-optic network.

The cable giant's decision came in response to a recommendation by a National Advertising Review Board (NARB) panel that Time Warner discontinue advertising claiming its network is 100% fiber optic.The NARB, an arm of the advertising industry's self-regulation forum, issued its decision in response to a challenge by Verizon Communications, Inc., Time Warner's competitor, which objected to broadcast, print and Internet advertising that claimed:

The NARB panel found Time Warner Cable's advertising gave the misleading impression it uses fiber-optic technology throughout its entire network, and represents the highest level of technology currently offered by telecommunications carriers. The panel found these messages were reinforced "by the advertiser's repeated emphasis on speed and the advanced nature of the Time Warner network."

The NARB decision hinged on the nature of the so-called last mile of a telecommunications network, the section that connects providers directly to the home. While most carriers use fiber-optic cable for the "backbone" of their networks -- including both Time Warner Cable and Verizon -- not all of them use fiber for the crucial "last mile."

Verzion's FIOS network, touted as "Fiber to the home," runs fiber-optic cable from Verizon's central offices to a terminal attached to the consumer's home. Time Warner Cable's network, a "hybrid fiber coax" or "Fiber to the node" network, employs fiber-optic cables from its central offices to a neighborhood "node," but then relies on coaxial cable to make the final connection to each consumer's home.

The technology used for the "last mile" connection, the NARB said, represents a significant difference in performance.

"The record in this case indicates that 'last mile' architecture is relevant to a network's
performance capabilities," the panel stated in a statement. "Prior NAD cases recognized differences between 'Fiber to the home' networks and 'Fiber to the node' networks, and the evidence in the present case shows those differences continue to exist. The record indicates that 'Fiber to the home' networks are generally considered to represent the highest level of technology currently used for consumer telecommunications services."

Time Warner Cable said the company "respectfully disagrees" with NARB's decision and maintained the claims were fully substantiated.

"Time Warner Cable believes that the panel's decision denies Time Warner Cable the opportunity to truthfully and accurately describe its fiber-optic network in its advertising -- a practice which it has engaged in for two decades without any signs of consumer confusion or harm," the company said in a statement. "In addition, the panel's decision inhibits the ability of Time Warner Cable and other service providers to distinguish their services in areas where their competitors have indisputably inferior products," the company said."

Despite its disagreement with the NARB, Time Warner Cable said it would modify or discontinue the advertising at issue "to comply with the panel's decision."